DIC Asset Aktiengesellschaft · Real estate company

DIC Asset
DIC Asset
DIC Asset
DIC Asset
DIC Asset

Press Release

DIC Asset AG Increases its FFO by 25% and Decreases its LtV below 50%

(Frankfurt, 03.05.2019)

  • Funds from operations (FFO) rise by 25% to EUR 17.0 million
  • Loan-to-value (LTV) drops to 49.8% (previous year: 56.2%)
  • Operating performance indicators substantially improved: EPRA vacancy rate reduced to 8.4%, WALT lengthened to 5.8 years
  • DIC Asset AG reaffirms its forecast for 2019


Frankfurt am Main, 03 May 2019.
DIC Asset AG, one of Germany's leading listed property companies, has enhanced the quality of its real estate portfolio with strong operating performance indicators while maintaining its growth trajectory. At EUR 17.0 million, the FFO exceeded the prior-year figure of EUR 13.6 million by EUR 3.4 million or 25%, a result to which the increased income from property management in the amount of EUR 9.2 million (previous year: EUR 8.9 million) contributed, as did a reduction of operating expenses. The consolidated income of EUR 9.2 million matched the prior-year level despite lower profits on property disposals.

Assets under management (AuM) totalled EUR 5.6 billion as of 31 March 2019 (31 December 2018: EUR 5.6 billion). Compared to the figure of EUR 4.8 billion as of 31 March 2018, their value increased by 17%, which is essentially attributable to positive valuation effects and to the growth in third-party business. The acquisition volume is already up to c. EUR 92 million this year to date; disposals from the Commercial Portfolio since the start of the year add up to c. EUR 22 million.

With the first quarter of the year brought to an excellent conclusion, the Management Board reaffirmed its forecast for the 2019 financial year.

The option to choose between a payment of the cash dividend in the amount of EUR 0.48 per share or a payment in the form of new shares, which the annual general meeting on 22 March 2019 resolved to offer to the shareholders, had an acceptance rate of 50%, thus exceeding the rate of 2018 by 13% (44%). More than EUR 16 million will be retained by the company to boost its continued growth and will thus help to optimise its financial structure.

"The net income of the first quarter continues our earnings growth where 2018 left off. We are getting tailwind from our company's operating achievements as much as from the faith that our investors have shown in our business model. As a result of the TLG shares transaction, the LtV ratio is now below 50%, and given our well-filled pipeline, we can at this time reaffirm the targets we defined for the 2019 financial year in all areas," said Sonja Wärntges, CEO of DIC Asset AG, as she commented the quarterly financial statements.

Increase in Value of the Properties Held in the Commercial Portfolio
The Commercial Portfolio segment included 100 assets with a market value of c. EUR 1.7 billion as of 31 March 2019 (previous year: EUR 1.6 billion). The increase despite the drop in the number of assets is primarily attributable to the significant appreciation of the portfolio properties. Since year-end, the AuM has remained stable (31 December 2018: EUR 1.7 billion). Another two acquisitions were completed since the start of the year. The annualised rental income in the Commercial Portfolio rose to EUR 98.3 million (previous year: EUR 93.1 million) during the reporting period. Like-for-like, they matched the prior-year level at EUR 90.9 million. The gross rental income earned during the first quarter of 2019 remained virtually unchanged at EUR 24.5 million (previous year: EUR 24.8 million). The weighted average lease term (WALT) rose from 4.9 years in the previous year to 5.8 years by 31 March 2019. During the same period, the EPRA vacancy rate dropped by 100 basis points to 8.4%, down from 9.4%.

Income from Funds Business up 27%
In the Funds segment, income climbed by 27% to EUR 11.2 million, mainly due to the transaction fees from sales of existing funds by the end of 2018. The assets under management maintained their prior-year total of c. EUR 1.6 billion as of 31 March 2019, disposals having been offset by acquisitions and valuation effects. The decline since year-end 2018 is mainly due to the disposal/expiry of the management mandate of the DIC HighStreet Balance fund (31 December 2018: EUR 1.8 billion).

Growing Third-Party Business in the Other Investments Segment
The assets under management in the Other Investments segment increased by EUR 0.2 million since year-end 2018, up to EUR 2.3 billion. This implies an increase by 44% since the first quarter of 2018 (31 March 2018: EUR 1.6 billion). More than anything else, the figure reflects the growing third-party business in real estate management. Now, DIC Asset AG has 20 properties with a combined lettable area of around 327,300 square metres under management through its own property management platform.

Loan-to-Value (LtV) below 50% for the First Time
Meanwhile, the company succeeded in pushing its LtV below the 50% mark for the first time, lowering it by 3.3 percentage points down to 49.8% as of 31 March 2019. It was primarily achieved by the conclusion of the TLG transaction. At the same time, the net interest result improved due to higher interest income to EUR -8.6 million (previous year: EUR -9.1 million) in Q1 2019. The equity ratio increased by 1.3 percentage points up to 37.3% since 31 December 2018.


Download Quarterly Statement Q1 2019 (PDF, 2,7 MB) >>

 


About DIC Asset AG:

DIC Asset AG is one of Germany's leading listed property companies, and specialises in commercial real estate. With around 20 years of experience on the German real estate market, the company maintains a regional footprint on all major German markets through six branch offices, and has 169 assets with a combined market value of c. EUR 5.6 billion under management. DIC uses a hybrid business model to manage its business divisions Commercial Portfolio, Funds and Other Investments. Taking an active asset management approach, DIC employs its proprietary, integrated real estate management platform to raise capital appreciation potential in its business divisions and to boost its revenues.

In its Commercial Portfolio division (EUR 1.7 billion in assets under management), DIC acts as proprietor and property asset holder, and thus generates revenues both from the management of the assets and through the value optimisation of its own real estate portfolio. The Funds division (EUR 1.6 billion in assets under management) generates its revenues by acting as issuer and manager of special real estate funds for institutional investors. Gathered in the business unit Other Investments (EUR 2.3 billion in assets under management) are strategic financial investments, the management of properties in which the company holds no equity stakes, equity investments in property developments and joint venture investments. DIC Asset AG has been included in the SDAX(R) segment of the Frankfurt Stock Exchange since June 2006. The Company's shares are also included in the EPRA index, which tracks the performance of the most important European real estate companies. (as of: 31/03/2019)


DIC Asset AG at a Glance

Key financial figures, in EUR million Q1 2019 Q1 2018
     
Gross rental income 24.5 24.8
Net rental income 21.2 20.5
Real estate management fees 9.2 8.9
Proceeds from sale of properties 11.2 42.6
Total income 50.6 81.7
Profits on property disposals 1.2 6.2
Share of the profit or loss of associates 2.4 0.4
Funds from operations (FFO) 17.0 13.6
EBITDA 27.2 28.2
EBIT 19.7 20.8
Profit for the period 9.2 9.2
Cash flow from operating activities 9.8 14.6
     
Key Financial figures per share in EUR* Q1 2019 Q1 2018
     
FFO 0.24 0.20
EPRA earnings 0.21 0.17
Earnings 0.13 0.14
*number of shares as per Q1 2019 of 70,526,249 (Q1 2018: 68,577,747)

 

Balance sheet figures, in EUR million 31/03/2019 31/12/2018
     
Loan-to-value (LtV) in % 49.8 53.1
Investment property 1,460.2 1,459.0
Total equity 913.6 895.9
Financial liabilities 1,423.0 1,481.1
Total assets 2,449.0 2,490.1
Cash and cash equivalents 364.9 286.9
     
Key operating figures Q1 2019 Q1 2018
     
Letting result in EUR million 8.8 3.0
EPRA vacancy rate Commercial Portfolio** in % 8.4 9.4
**without warehousing and project developments    

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Investor Relations & Corporate Communications

DIC Asset AG
Peer Schlinkmann
Head of Investor Relations and Corporate Communications

Neue Mainzer Straße 20 • MainTor
60311 Frankfurt am Main

Tel. +49 69 9 45 48 58-14 92
ir@dic-asset.de